[dropcap]For[/dropcap] the last six plus years, Chinese investors made up around 80% of the total number of investors in the EB-5 Program.With expected wait times of more than 10-years, some Chinese EB-5 investors are looking for ways to withdraw their investment funds and abandon their pursuit of the EB-5 visa.

Since its inception in the 1990s, the EB-5 Program has poured billions of dollars of foreign investment into the U.S. real estate market and has created hundreds of thousands of jobs for qualified U.S. workers, all at no cost to U.S. taxpayers.

After the 2008 recession, the EB-5 Program was hailed as a good alternative solution to traditional lending, at a time when the U.S. economy desperately needed it, but now that the economy has improved, Congress has little motivation to reform the program.

This has raised understandable fear among Chinese investors who face ever-increasing wait times for their chance at the EB-5 visa. The EB-5 visa has been marketed in Mainland China for years as the “Golden Visa”, or the pathway to U.S. citizenship and the American dream for their families. The EB-5 visa, if obtained, gives qualified investors, their spouses, and unmarried children under the age of 21 years all green cards in exchange investing at minimum of $500,000 into a U.S. job-creating commercial enterprise.

This marketing used to have investors from Mainland China jumping at the chance to invest in EB-5. These investors wanted a chance to move away from the political uncertainties of their home country and to obtain all the advantages the U.S. had to offer such as world-renowned educational opportunities for their children. The changing political atmosphere of China and the long-wait times for the visa, however, have many Chinese investors rethinking tying up their capital. Many believe that their children will age out of the program before they even secure conditional permanent residency.

On the other hand, some investors from Mainland China believe that if they wait it out, that others will drop out of line, meaning that they will secure a visa in less years. Many investors are no longer interested in that gamble. They would rather try to get back their investment rather than leave it at-risk in a project or redeployed into other unfamiliar projects. The EB-5 Program requires that investments remain “at-risk” in order to qualify for the program. Leaving the funds tied up in the EB-5 Program for years not only adds risk, but it also means they cannot access the funds for their own business needs or for investing in other countries potentially faster “golden visa” programs.

This has lead some Chinese EB-5 investors to seek out U.S. litigation attorneys who can assist them with getting their money back. Many of these investors made their investments years ago and did not expect to face such long delays. Some of them were even given misleading information by EB-5 agents about the EB-5 visa wait times in order to encourage them to apply for the program. Developers are worried about losing this funding and are not making it easy for Chinese investors to get their money back.

According to The Real Deal, attorneys for a group of investors are going after regional centers, bringing lawsuits to try to dissolve these investor funds, often arguing that investors were provided with misinformation about the quality of their investments and the timelines. Consulting with an EB-5 attorney can be very beneficial for any investor uncertain of what their rights are and what options they have.

With all the news about immigration issues at the U.S.-Mexico border drawing headlines, Congress has subtly signaled that addressing the issues with the EB-5 Program is on back-burner. Not addressing this issue could cause an upset in the real estate market in major cities such as New York. Regional centers and developers could potentially have to return up hundreds of millions of dollars in capital to investors.

While it seems that the EB-5 Regional Center Program will, like it has in the past, be extended without reform this coming September, the issue with the visa backlogs will only worsen. As information seeps out about the real timeline for investment, the EB-5 Regional Center Program could soon see a serious drop-off in the number of investors from countries facing retrogression.

Some suggestions that have been made to address the visa backlog include auctioning off a certain number of EB-5 visas to the highest bidders to reduce the backlog, increasing the visa cap to count only investors, and increasing the minimum investment amount to reduce the number of investors applying.